Service Tax on Construction of Residential Apartments
This query is : Resolved
14 August 2010
Suppose a builder wants to collect and pay service tax, which the best scheme available to him.
1) 75% abatement
2) 67% abatement
3) 4.12% WCT (whether available to him)
4) 10.30% only on Labour (whether available to him)
1) 75% abatement
2) 67% abatement
3) 4.12% WCT (whether available to him)
4) 10.30% only on Labour (whether available to him)
14 August 2010
All the schemes are having own limitations and advantage
option 1 & 2- you may not claim cenvat input
option 3 - you can avail cenvat, but threre is no segragation of material and labour, total contract value will be the taxable.
Option 4- Manitenance of invoice separately labour and mateirals and cenvat input also available
option 1 & 2- you may not claim cenvat input
option 3 - you can avail cenvat, but threre is no segragation of material and labour, total contract value will be the taxable.
Option 4- Manitenance of invoice separately labour and mateirals and cenvat input also available
14 August 2010
I agree on all the above.
Please clarify whether option 3 and option 4 are available to a builder selling residential apartments.
There is one view that since the entire tower is sold under different apartments, option 3 and 4 are not available to a builder.
Please clarify whether option 3 and option 4 are available to a builder selling residential apartments.
There is one view that since the entire tower is sold under different apartments, option 3 and 4 are not available to a builder.
14 August 2010
Dear Sir,
Since the builders get themselves registered under the work contract under the Existing VAT so they can definately take the benefit of 4.12 % Tax
Since the builders get themselves registered under the work contract under the Existing VAT so they can definately take the benefit of 4.12 % Tax
16 August 2010
Correct me if I am wrong. The final understanding is as under:
1) Builder gets himself registered under work contract under existing VAT and takes benefit of 4.12% scheme
2) The apatments are sold before getting Completion certificate.
3) Builder pays Service Tax under the 4.12% and offsets it against input credit for services and capital goods (not for input goods).
1) Builder gets himself registered under work contract under existing VAT and takes benefit of 4.12% scheme
2) The apatments are sold before getting Completion certificate.
3) Builder pays Service Tax under the 4.12% and offsets it against input credit for services and capital goods (not for input goods).
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